Backward Bending Supply Curve of Labour - Inverted S Shaped Supply Curve

Inverted S Shaped Supply Curve

At very low wage levels the supply curve may also be curved backwards, creating an "inverted s" shape. In this case, further lowering wages will have the effect of increasing the supply of labor. This is explained by the fact that families have some minimum level of income needed to meet their subsistence expenditure requirement.

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